Johnson's Industrial Caterers, Inc.

352 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Johnson's Industrial Caterers, Inc. and Sales Drivers, Sales and Service Local 176, affiliated with the International Brotherhood of Teamsters, Chauf- feurs, Warehousemen and Helpers of America. Case 9-CA-6365 June 9, 1972 DECISION AND ORDER BY MEMBERS FANNING, KENNEDY, AND PENELLO On February 23, 1972, Trial Examiner Henry L. Jalette issued the attached Decision in this proceed- ing. Thereafter, Respondent filed exceptions and a supporting brief, and the General Counsel filed limited exceptions and a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel: The Board has considered the record and the Trial Examiner's Decision in light of the exceptions and briefs and has decided to affirm the Trial Examiner's rulings, findings, and conclusions and to adopt his recommended Order, except as modified herein.' ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Trial Examiner and hereby orders that Respondent Johnson's Industrial Caterers, Inc., Dayton, Ohio, its officers, agents, successors, and assigns, shall take the action set forth in the Trial Examiner's recommended Order, as herein modified. 1. Delete in paragraph 1(d) the words "In any like or related manner" and substitute the words "In any other manner." 2. Substitute the attached notice for the Trial Examiner's notice. 1 We find no merit in the Respondent's exceptions, including the contention that its abrupt change in the working conditions of its drivers was motivated solely by economic considerations and , its contentions concerning the remedy The only exceptions filed by the General Counsel have to do with remedy At fn 8 of his Decision, the Trial Examiner stated that his recommendation as to remedy accorded with the General Counsel's request We note , however, that in his brief to the Trial Examiner the General Counsel asked not only for a remedy whereby the Union would have an opportunity to determine a course of action which would reflect the wishes of the bargaining unit employees but also for a make-whole order "for any loss of wages of fringe benefits suffered as a result of the unilateral changes illegally instituted by the Respondent " As to this request, we agree with the Trial Examiner that the employees should be made whole for any losses suffered by reason of the changes only if they express desire for restoration of their earlier employment status However, we find merit in the General Counsel's contention that a broad order is appropriate when the facts support both an 8(a)(3) violation and an 8(a)(5) violation in the institution of unilateral changes APPENDIX NOTICE TO EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL bargain, upon request, with Sales Drivers, Sales and Service Local 176, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as the exclusive representative of all our employees in the bargaining unit defined below with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment and, if an understanding is reached, embody such understanding in a signed agree- ment. The bargaining unit is: All route drivers, checkers, and order fillers at our Dayton operation, but exclud- ing all office clerical employees, professional employees, guards and supervisors as de- fined in the Act. WE WILL NOT make changes in the wages and other conditions of employment of our employees in the appropriate unit above without consulting and negotiating with Sales Drivers, Sales and Service Local 176, affiliated with International Brotherhood of Teamsters, Chauffeurs, Ware- housemen and Helpers of America. WE WILL, if requested by Sales Drivers, Sales and Service Local 176, affiliated with Internation- al Brotherhood of Teamsters, Chauffeurs, Ware- housemen and Helpers of America, revoke the changes in wages and working conditions institut- ed by us on July 9, 1971, affecting employees in the appropriate unit and restore the wages and working conditions in effect prior thereto, and make employees whole for any losses they may have suffered by reason of the changes instituted on July 9, 1971. WE WILL NOT make changes in the wages and other conditions of employment of our employees because you have selected a labor organization as your exclusive representative for purposes of collective bargaining and to avoid fulfilling our obligation to bargain with your representative. WE WILL NOT in any other manner interfere with, restrain, or coerce employees in the exercise of their right to self-organization, to form, join, or assist Sales Drivers, Sales and Service Local 176, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Help- ers of America, or any other labor organization, to bargain collectively through representatives of 197 NLRB No. 60 JOHNSON'S INDUSTRIAL CATERERS, INC. 353 their own choosing, to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all such activities. You are free to become and remain members of Sales Drivers, Sales and Service Local 176, affiliated with International Brotherhood of Teamsters, Chauf- feurs, Warehousemen and Helpers of America, or any other labor organization. JOHNSON'S INDUSTRIAL CATERERS, INC. (Employer) Dated By (Representative) (Title) This is an official notice and must not be defaced by anyone. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. Any questions concerning this notice or compli- ance with its provisions may be directed to the Board's Office, 550 Main Street, Federal Office Building, Room 2407, Cincinnati, Ohio 45202, Telephone 513-684-3686. TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE HENRY L . JALETTE, Trial Examiner: This case presents questions of whether Respondent violated Section 8(a)(1), (3), and (5) of the Act by bargaining in bad faith, unilaterally changing conditions of employment, and dealing directly with employees, and whether it violated Section 8(a) (3) and ( 1) when its unilateral changes caused two employees to quit. The charge was filed by the Union on July 7, 1971,1 and was amended on July 19. Pursuant thereto, complaint issued on August 26. On November 3, a hearing was held in Dayton, Ohio. Upon consideration of the entire record, including my observation of the witnesses and the beefs filed by General Counsel, the charging party, and Respondent , I make the following: FINDINGS OF FACT 1. THE FACTS Respondent is an Ohio corporation engaged in food service delivery and sale from vending trucks, with facilities in Dayton, Columbus, and Newark, Ohio.2 The Dayton, Ohio, facility is the only facility involved in this proceeding. On March 2, the Union was certified as bargaining representative of Respondent's employees at the Dayton facility in the following unit: All route drivers, checkers, and order fillers employed by the Employer at its Dayton, Ohio, operation, but excluding all office clerical employees, professional employees, guards, and supervi- sors as defined in the Act. On or about March 18, the parties commenced bargain- ing and held between 10 to 15 meetings during the period from March 18 to July 12. Throughout the negotiations, the Union was represented by Business Representative Dick Loy and employees Larry Sprout and Betty Stanfill. Respondent was represented by its vice president, Robert Johnson, and an individual named Galbraith. The testimony of all the witnesses was rather general about their discussions at all the meetings. The meeting of March 18 was described as informal with the Union stating it would submit written proposals at the next meeting. The next meeting was on March 25 and the Union submitted a standard form of contract and explained to Respondent the meaning of its provisions. The next meeting was on April 8 and at this meeting the Union submitted a contract proposal, using provisions culled from the standard form it had presented on March 25. The proposal contained no provisions on wages. The parties went through the proposal without reaching agreement on any provisions. Johnson told the Union he wanted his attorney to check the proposals. At the next meeting on April 12, the Union submitted its economic demands covering matters such as wages, holidays, vacations, and a guaranteed wage. The Respon- dent stated it would have to cost-out the proposal, because it had no idea then of the impact on its operations. There were two other meetings in April, but all that the record discloses as having been discussed were the term of the contract and an absentee problem. At a meeting in early May, Johnson advised the Union that he was considering a change in method of operations and was going on a trip to check on the operations of other mobile caterers, one in California, another in St. Louis. There were other meetings in May, but the record does not indicate what was discussed. Respondent tentatively agreed to some of the Union's proposals, but it did not submit any counterproposals. According to Loy, Johnson spoke in generalities about changing his method of operation and said he would submit a proposal when his ideas had jelled. He was to have proposals to submit after his trip. During May, Johnson asked drivers Stanfill and Sprout to keep a record of the supplies they used for a period of 30 days to see what would happen if they were operating under a difference between the wholesale and retail price. Stanfill and Sprout did as they were requested, but, except for asking them about gasoline usage, Johnson never asked to see the results of their recordkeeping. The parties had a meeting in June after Johnson's return from his trip. Johnson told the Union he was going to computerize his pricing situation and had ordered a computer. He provided the Union, at Loy's request, with a copy of a lease agreement he had obtained from Nick's Catering Service, Inc., in St. Louis. At some point, the I Unless otherwise indicated, all dates appearing hereinafter refer to and I find, that Respondent meets the Board 's $500,000 retail and $50,000 1971 direct inflow standards for the assertion of junsdiction 8 Commerce is not in issue. The complaint alleges, the answer admits, 354 DECISIONS OF NATIONAL LABOR RELATIONS BOARD record is not clear as to the date, but before July 9, Loy and Johnson discussed Nick's lease agreement. Loy asked Johnson whether Nick's operators were employees or independent contractors. Either in this conversation, or another on the same subject, Loy indicated that the Union would insist on negotiating about any changes. A week or so before July 9, Johnson told Stanfill and Sprout, the employee representatives on the Union's bargaining committee, that they would have to tell Loy that it would be another 6 weeks before he could give him any facts and figures on the new system, because it would be 6 weeks before he got the computer. Stanfill and Sprout asked him if they couldn't discuss the language part of the contract and get that settled and discuss economics later. Johnson refused About July 6, Loy called Johnson to tell him of a rumor he had heard of the possibility of a work stoppage by the employees because of a fear they were about to be charged with shortages. Loy also told him of the unfair labor practice charge being filed accusing Respondent of a refusal to bargain. (The charge, dated July 6, was filed on July 7.) A meeting was scheduled for July 8, but it was canceled because Johnson couldn't make it and resched- uled for July 9. It never took place, but the record does not indicate why. Prior to July 9, the working conditions of the route drivers were as follows: Respondent provided the canteen- type trucks, including gasoline, the products to be sold (except for cigars) and all supplies (cups, spoons, towels, condiments, etc.). The workweek was from Monday through Friday and the drivers reported to the plant to load their trucks about 2:30 a in., and returned from their rounds about 2.30 p.m. They were paid on a commission basis, receiving a 20 percent commission on food items sold, 10 percent on milk, and 4.5 percent on cigarettes. They received credit for returns. They were required to wear uri.,orms and Respondent paid one half the cost. On July 9, about 3 p.m., Johnson called a meeting of employees. He told them he had heard of the possibility of a strike, that he didn't want to scare them, but he was instituting a new system effective Monday, July 12, under which the drivers would be independent drivers. He then explained the changes that were being made. He told them that they would buy the merchandise from Respondent at a wholesale price and sell it at a retail price. They would buy food items, including milk, at a 36 percent discount, and would pay for their supplies according to a puce list Respondent would prepare. They would pay a truck rental charge of 10 percent of gross sales. Returns would no longer be accepted for credit. Questions were asked about insurance, vacations, and holidays, and Johnson told the drivers he did not know what would be done about insurance (for which employees were then charged a nominal premium), but coverage would be continued in effect until he did know.3 Vacations and holidays would be discontinued. (Johnson disputed saying this, but it is clear from his testimony that this is 3 Whether a change in insurance was ever made is in some doubt According to Sprout, about October, an insurance representative spoke to the employees and told them that since they were in business for themselves, they would have to carry their own insurance This meant that coverage what was in fact done and Johnson's denial that these benefits were discontinued is a rationalization resulting from his assurances to the employees that they would make more money under the new system and this would' substitute for the loss of vacation and holiday benefits.) Uniforms would still be required but employees would bear the full cost. (It is not clear whether employees were so advised on July 9, but Sprout testified, without contradiction, that he has been so advised by a supervisor since July 9.) Johnson said that he did not know how much a driver would be charged when he was absent, whether it would be a flat rate or a commission rate. (Later, the rate was fixed by Respondent at $30 a day.) Johnson indicated that the change would be for a trial period of 30, 60, or 90 days, and he assured the drivers that during that period he would be able to show them they would make more money under the new system. He told the drivers he would guarantee their normal salary during the test period. The employees were instructed. to report to work on Saturday to inventory their trucks. On Friday evening, the employees had a union meeting in which they debated calling a strike. Loy advised them not to strike, but to inventory their trucks on Saturday as instructed and to wait to see what was going to happen. Monday morning the drivers reported to work and started their rounds with the new inventory. On Monday afternoon, Loy met with Johnson to discuss the changes the status of the drivers. He asked Johnson to r;. . to the old system and to negotiate from that point. Johnson refused. He said he had to make the change because of an absentee problem and he thought the change was economically sound. He said if the change did not work he would close down the Dayton business. When Johnson announced the new system on Friday, he told the drivers that at the end of each day they would make a deposit (varying in amount depending on the route) in Respondent's account as part payment for the sale items they had purchased and he explained that the following day each driver would settle up by paying the remainder of his bill. This procedure would be repeated each day. There was a misunderstanding about this and it appears no deposits were made Monday afternoon. On Tuesday, after servicing their routes, the drivers discovered that bills for Monday's purchases were not ready and they could not settle up. Moreover, they were required to make deposits for both Monday's and Tuesday's purchases. (In the case of Stanfill, she had to make two $100 deposits.) On reporting to the plant on Wednesday, the drivers refused to load their trucks until they were given bills for their sales on Monday. Betty Stanfill received a bill for $190.26 for Monday. Her total receipts for that day were $213 and some cents. Stanfill owed an additional $96 for supplies in her inventory, part of which she had used and she felt the bill could not be right. She spoke to Johnson about it and he which had cost the employees 75 cents per week would cost them over $11 per month Johnson testified not only that insurance has been continued, but even more that Respondent now pays the 75 cents per week Any doubt about the matter can be resolved in the compliance stage JOHNSON'S INDUSTRIAL CATERERS, INC. told her to load her truck and to start out on her route, that he would straighten the matter out later. Stanfill told him she couldn't afford to run the route under those circum- stances and she quit. Under essentially similar circum- stances, Karen Holloway also quit.4 II. ANALYSIS AND CONCLUSIONS A. The Refusal To Bargain The alleged refusal to bargain has three parts: (1) The changes in method of operation are alleged to have been undertaken unilaterally and are consequently alleged to be unlawful; (2) the discussion of the changes with the employees on July 9 is alleged to have constituted direct dealing with employees in derogation of the Union's status as exclusive representative of the employees; and (3) the Respondent's conduct during the course of negotiations is alleged to evidence bad faith and a purpose on the part of Respondent to avoid entering into a collective-bargaining agreement. 1. The unilateral changes in method of operations issue 5 The facts recited above are essentially undisputed. The Union admits, as Respondent contends, that during the negotiations in May, Johnson advised it that it was considering changing its method of operations, and Johnson even gave Union Agent Loy a copy of a lease agreement used by Nick's Catering Service, Inc., of St. Louis for its route drivers. But, beyond telling the Union that it was considering a change and was investigating other operations and that a computer had been ordered, Respondent did not notify the Union, nor consult with it, about any of the changes announced on July 9. It is undisputed that at no time during the negotiations did the parties ever discuss economic issues. Yet, Respon- dent's changes in method of operations really involved economic matters only, such as rate of commission, cost of supplies to the driver, cost of truck rental, and the like. In addition, the changes in method of operations involved such mandatory subjects of bargaining as insurance, vacation, and holidays. None of these subjects had been discussed in negotiations. But if the issue of the unilateral nature of Respondent's conduct were in doubt, the doubt would be eliminated by Johnson's admission that when he mentioned to the Union the possibility of a change in the method of operation, Business Representative Loy told him any change in working conditions would have to be negotiated. Despite this, Johnson never mentioned the changes to Loy thereafter and instituted them on July 9. Such unilateral conduct clearly violated Section 8(a)(5) of the Act. N.L.R.B. v. Katz, 369 U.S. 736 (1962). Respondent makes other contentions in defense of its conduct, which are so clearly lacking in merit that, with one exception, they do not warrant discussion. The exception is the contention that Respondent has been and 4 Two other drivers also quit who, like Stanfill and Holloway, were alleged to have been constructively discharged At the hearing, General Counsel moved to dismiss the complaint as to those other two drivers I granted the motion 355 is still willing to discuss with the Union the effects of the change. As I understand Respondent, it is contending that its decision to change method of operation was not a mandatory subject of bargaining and that it was only obligated to bargain about the effects of its decision. In support of this position, Respondent cites N.L.R.B. v. Adams Dairy, Inc., 350 F.2d 108 (C.A. 8), cert. denied 382 U.S. 1011, and General Motors Corp., 191 NLRB No. 149. In Adams Dairy, the Court held that an employer is not required to bargain about a decision to terminate a phase of its business and that a decision to convert from a system of distribution by employees to distribution by independ- ent contractors was a basic operational change which was the equivalent of a decision to closeout part of its business. In General Motors, using the same rationale as used by the Court in Adams Dairy, the Board held that the decision to sell a dealership was not a mandatory subject of bargain- ing. These decisions are significant, but Respondent has not articulated how they are applicable to this case. Their applicability is evident, if Respondent were contending that it terminated its distribution of canteen foods at Dayton and changed to a system of sales by independent contractors. But Respondent asserts in its brief that "The question of whether the changed operation resulted in an independent contractor relationship with the drivers is not an issue in this case." If such were the case, Adams Dairy and General Motors would be inapplicable. As can be seen from the foregoing, there is an ambivalent quality about Respondent's position. Whatever arguments Respondent may now make, however, it appears to me the status of the drivers is an issue that cannot be avoided, and while there is some doubt in my mind whether the court's view in Adams Dairy accords with the view of the Board, by whose decisions I am bound (General Motors suggests that the Board may give hospitable reception to the court's view in the future), I will assume, arguendo, that an employer is not required to bargain about a decision to change from an employee distribution system to a system of distribution by independent contractors. The question is were Respon- dent's drivers converted from employees to independent contractors. In determining the status of persons alleged to be independent contractors, the Board normally applies the "right to control" test. If the company retains the right to control not only the result to be achieved, but also the manner and means of achieving it, the relationship is an employer-employee relationship. , The i evidence that ^ Re- spondent retained ; the right to control the manner and means of selling canteen foods is overwhelming. No written contracts were entered into; the arrangement was oral and terminable at will. (See Borden, Inc., 192 NLRB No. 7). The trucks continued to be the property of Respondent and drivers were charged a truck rental fee unilaterally determined by Respondent. As to the food items sold, Respondent fixed both the wholesale and retail prices. Respondent also fixed the prices of supplies. S The changes are also alleged to have been motivated by antiunion considerations in violation of Sec. 8(a)(3), and this aspect of the changes will also be treated under this heading. 356 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Supplies (except gasoline) and the items for sale (except cigars) had to be purchased from Respondent. As to the routes, they continued to be the property of Respondent. Respondent kept a record of the customers of each route and drivers were required to report any new customers. Respondent retained the right to take customers from one route and assign it to another and the right to determine who would be assigned to any particular route. If a route became available, drivers could bid on it on the basis of seniority. Drivers could not drop a customer or change any customer stops without approval by Respondent. The drivers were required to wear uniforms and their hours of work were the same as before the change and could not be vaned because of the closing hours of the stockroom. If desirous of a day off, or if they were to be absent, drivers had to consult a supervisor. When absent, Respondent provided a driver and charged the regular driver $30 for each day. The drivers could not hire their own replace- ments nor could they use helpers without Respondent's approval. It seems supererogatory to discuss any additional details about the status of the drivers after July 9. It is abundantly clear that they possess none of the indicia of independent contractors. In Dan Dee West Virginia Corp., 180 NLRB 534, more significant changes in the working conditions of route salesmen were deemed insufficient to qualify them as independent contractors. Actually, Respondent did not make a change in its method of operations . ". . . there was [no] change in the capital structure of [Respondent] which resulted in a partial liquidation and a recoup of capital investment." Adams Dairy, supra, at 111. Rather, the only change was in the method of computing the earnings of the drivers. This change was hardly basic, nor did it change the employee status of the drivers. As Respondent's drivers continued to be employees, and as Respondent's changes related to their wages and other terms and conditions of employment, it was required to bargain with the Union before putting any of the changes into effect. As indicated above, this was an obligation it failed to fulfill. _ Up to this point, I have adverted to Respondent's assertion that its changes in method of operation was economically motivated without deciding whether or not it was in fact so. In my judgment , the evidence is substantial that the change in method of operations was motivated by a desire to avoid bargaining with the Union. Respondent had three facilities, the Dayton facility involved herein, and facilities in Newark and Columbus, Ohio. The Newark and Columbus facilities are not unionized. No changes were made in the method of operation there. Johnson testified that the reason for this was that the changes were experimental and the employee complement at Newark was too small and at Columbus too large to select either of those two locations to test the workability of the changes. I do not credit his explanation. According to him, the idea for this change dated back more than 2 years before the advent of the Union and at that time he had investigated the matter to the extent of making a trip to St. Louis and to California. However, only after the Union was certified was the idea brought to fruition. For 2 years, it rested in limbo. Nothing was being done to pursue the idea further. After the Union was certified , the decision was made and a computer was ordered . But although this occurred in May, all that the Union was told was that a computer had been ordered. Moreover, the fact that a computer had been ordered did not necessarily mean that the working conditions of the employees had to be changed. Nothing was said to Loy about that. On July 6, only 3 days before the changes were announced to the employees , Loy spoke to Johnson about rumors of a strike and the filing of a charge and Johnson gave no intimation of the pending change. Three days later, he announced the changes to the employees. In my judgment, these circumstances, consid- ered with Respondent's inaction during a period of 2 years when it was allegedly investigating the possibility of a change, compel a finding that the changes in working conditions were instituted because the employees had selected the Union as their representative for purposes of collective bargaining and in order to avoid fulfilling Respondent's obligation to bargain with it. The changes were therefore not only violative of Section 8(a)(5), but also Section 8(a)(3). 2. The direct dealing with employees The unilateral changes announced on July 9, which I have found violative of Section 8(a)(5) because they were instituted without notice to or consultation with the majority representative, are also alleged, by amendment to the complaint at the hearing, to be violative of Section 8(a)(5) on the ground that when Respondent met with the employees on July 9 and announced the changes in method of operations, and when thereafter it discussed with employees problems that arose under the new system, it was engaged in direct dealing with the employees in derogation of the status of the Union as majority representative. Of course, the unilateral conduct derogated from the Union's status as majority representative and little is added either to the remedy in this case or the body of law on the subject to find a violation on the theory of direct dealing. In my judgment, the conduct of Respondent did not constitute direct dealing with employees in the sense in which the term is normally used . Respondent was not making offers to employees seeking acceptances, nor was it seeking to induce employees to repudiate the Union. While the effect of its unilateral change in working conditions was to undermine the Union , I cannot see how the implementation and announcement of what was clearly a predetermined course of action constituted direct dealing. Huttig Sash and Door Company, Incorporatet 154 NLRB 811, 817. Compare Dan Dee West Virginia Corp., supra, at 539. 3. Bad-faith bargaining As indicated earlier, Respondent land the Union met 12 to 15 times. As a result of these meetings , certain contract proposals of the Union were tentatively agreed upon. The Union submitted a wage proposal , but it was never discussed. Respondent never made a counterproposal. Johnson had promised to do so upon return from his trip to investigate lease arrangements of other food distribu- tors, but he never did so. Instead, he unilaterally changed JOHNSON'S INDUSTRIAL CATERERS, INC. working conditions with the obvious intention of destroy- ing the unit in which certification had issued. Moreover, at the very time he was meeting with the Union in negotiations, he had a written counterproposal in his possession, which he did not produce and submit to the Union until September. (Significantly, the complaint herein had issued on August 26, charging Respondent with a failure to bargain in good faith.) That counterproposal reflected the tentative agreement reached on several issues, made specific counterproposals on matters such as man- agement rights, seniority, leave of absence, and grievance and arbitration provisions, but was silent on all economic issues, including wages, holidays, vacations, and uniforms, despite the fact the Union had submitted a proposal on those issues and despite the fact Respondent as far back as July 9 had adopted new commission rates, instituted truck rental charges, abolished vacations and holidays, and required employees to pay for their uniforms. In my judgement, such conduct clearly reflects that Respondent had no intention of negotiating a collective-bargaining agreement. In N L.R B. v. Katz, supra, the Supreme Court indicated that unilateral action ". . . will often disclose an unwillingness to agree with the union." In this case, the unilateral conduct was intended to destroy the bargaining unit, and when the unilateral action is considered with Respondent's inertia at the bargaining table, including the belated submission of a somewhat meaningless counterpro- posal, it is clear that, from the inception of bargaining, Respondent was engaged in bargaining in bad faith and with no intention to enter into a collective-bargaining agreement. B. The Constructive Discharge of Betty Stanfill and Karen Holloway As noted earlier, both Betty Stanfill and Karen Hollo- way quit their employment on July 14 rather than work under the new system. General Counsel and the Union contend that they were constructively discharged. I have carefully considered the cases cited by the Union in support of this contention and I consider them factually distinguishable. In the first place, the changes did not impose onerous working conditions on the employees. The hours of work, the routes, everything, continued un- changed. Moreover, although the changes appear to have been an abortive attempt at creating independent contrac- tors, the drivers were not required to assume any financial obligations. Secondly, to the extent that their earnings were affected, the drivers suffered no substantial reduction in earnings. This is evident from the testimony of Larry Sprout. True, at first blush, it appeared to Stanfill and Holloway that they would suffer substantial reductions under the new system. However, it is undisputed they were assured that the matter would be straightened out and I find their 6 The purpose of this remedy is to insure that the employees in the appropriate unit will be accorded the services of their selected bargaining agent for the period provided by law See Mar-Jac Poultry Company, Inc, 136 NLRB 785, Commerce Company d/b/a Lamar Hotel, 140 NLRB 226, 229, enfd. 328 F 2d 600 (C A 5), cert. denied 379 U S 817, Burnett Construction Company, 149 NLRB 1419, 1421, enfd 350 F 2d 57 (C.A 10), Waycross Sportswear, Inc, 166 NLRB 101, enfd 403 F.2d 832 (CA. 5) 357 reasons for not believing the assurances unconvincing. Moreover, on July 9, Johnson had guaranteed the drivers they would not receive less under the new system than they did under the old. Significantly, all but four of the drivers continued to operate their routes. Under these circum- stances, I conclude that Stanfill and Holloway were not justified in quitting and were not constructively discharged. Accordingly, I shall recommend dismissal of the allega- tions of the complaint relating to them. III. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondent set forth in section II, above, occurring in connection with its operations de- scribed in section I, above, have a close, intimate, and substantial relationship to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. IV. THE REMEDY Having found that Respondent has engaged in unfair labor practices in violation of Section 8(a)(I), (3), and (5) of the Act, I shall recommend that it be ordered to cease and desist therefrom and to take certain affirmative action designed to effectuate the policies of the Act. As to Respondent's refusal to bargain in good faith, I shall recommend that Respondent be ordered to bargain with the Union in the appropriate unit for which it was certified. As the evidence shows that such refusal to bargain in good faith existed at the inception of negotia- tions, I shall recommend that the normal certification year be extended for a period of 1 year from the date when Respondent begins to bargain in good faith with the Union as the recognized representative of the employees in the appropriate unit .6 As to the unlawful changes in working conditions, it is customary in circumstances such as are here presented where the employer's unilateral conduct has not been motivated by good faith, nor occasioned by compelling business considerations, to order the Respondent to revoke the changes and to restore the conditions in existence prior thereto.? However, as it cannot be predicted with certainty whether the employees desire such revocation, I shall recommend that restoration be conditioned upon the affirmative desire of the affected employees for such, as expressed through their collective-bargaining representa- tives.8 I shall further recommend that Respondent make available to the Union, upon request, all records necessary and relevant to decide whether it desires restoration of the working conditions in effect prior to July 9. Since I have found that Respondent was discriminatorily motivated within the meaning of Section 8(a)(3) of the Act in making changes in working conditions on July 9 and r Great Western Broadcasting Corporation d/b/a KXTV,139 NLRB 93, 96. 9 This recommendation accords with the General Counsel's request. Although the Union has requested an order restoring the status quo ante, I do not understand it to be opposed to a conditional order such as I am recommending above. 1 358 DECISIONS OF NATIONAL LABOR RELATIONS BOARD that such changes were also violative of Section 8(a)(5) of the Act by reason of Respondent's failure to bargain with the Union with respect thereto, I would normally recom- mend that all employees affected by the changes be made whole for any losses they may have suffered by reason of the changes, whether arising from the pricing system adopted or the elimination of fringe benefits such as insurance, holidays, vacations, and uniforms. However, if the employees, acting through their collective-bargaining representative, express the desire to retain the new system in preference to restoration of the old, it appears to me that a make-whole remedy would be unnecessary and inappro- priate. Accordingly, I shall recommend that the employees be made whole for any losses suffered by reason of the changes, only if the employees express the desire for restoration as provided above. In such event, all losses to be reimbursed shall be computed in accordance with the formula set forth in F. W. Woolworth Company, 90 NLRB 289, to which shall be added interest at the rate of 6 percent per annum in accordance with Isis Plumbing Jr Heating Co, 138 NLRB 716. Finally, despite Respondent's unlawful motivation in making changes, the essential ingredient of its unfair labor practices has been its refusal to bargain for which I deem a narrow order appropriate. CONCLUSIONS OF LAW 1. Johnson's Industrial Caterers, Inc., is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. Sales Drivers, Sales and Service Local 176, affiliated with the International Brotherhood of Teamsters, Chauf- feurs, Warehousemen and Helpers of America, is a labor organization within the meaning of Section 2(5) of the Act. 3. All route drivers, checkers, and order fillers em- ployed by Respondent at its Dayton, Ohio, operation, but excluding all office clerical employees, professional em- ployees, guards, and supervisors as defined in the Act constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. Sales Drivers, Sales and Service Local 176, affiliated with the International Brotherhood of Teamsters, Chauf- feurs, Warehousemen and Helpers of America is the exclusive representative of the employees of Respondent in the above-described unit within the meaning of Section 9(a) of the Act. 5. By changing the working conditions of its employees without notice to and consultation with the Union certified as the exclusive representative of its employees in an appropriate unit and by negotiating in bad faith with no intention to enter into a collective-bargaining agreement, Respondent engaged in, and is engaging in, unfair labor practices within the meaning of Sections 8(a)(5) and (1) and 2(6) and (7) of the Act. 6. By changing the working conditions of its employees because they selected the Union as their exclusive representative for purposes of collective bargaining and in order to avoid fulfilling its obligation to bargain with the 9 In the event no exceptions are filed as provided by Sec 102 46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, recommendations, and recommended Order herein shall, as Union, Respondent has engaged in, and is engaging in, unfair labor practices within the meaning of Sections 8(a)(3) and (1) and 2(6) and (7) of the Act. 7. General Counsel has failed to establish by a preponderance of evidence that Betty Stanfill and Karen Holloway were constructively discharged in violation of Section 8(a)(3) and (1) of the Act. Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: 9 ORDER Respondent, Johnson's Industrial Caterers, Inc., its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain with Sales Drivers, Sales and Service Local 176, affiliated with the International Brother- hood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as the exclusive representative of its employees at Dayton, Ohio, in a unit of all route drivers, checkers, and order fillers, but excluding all office clerical employees, professional employees, guards, and supervi- sors as defined in the Act. (b) Changing the working conditions of employees in the appropriate unit without consulting and negotiating with Sales Drivers, Sales and Service Local 176, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America. (c) Making changes in working conditions of its employees with a purpose of undermining the exclusive representative of its employees and to avoid fulfilling its obligation to bargain with such exclusive representative. (d) In any like or related manner interfering with, restraining, or coercing its employees in the exercise of their rights to self-organization, to form, join, or assist the above-named labor organization, or any other labor organization, to bargain collectively through representa- tives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection as guaranteed by Section 7 of the Act, or to refrain from any or all activities. 2. Take the following affirmative action designed to effectuate the policies of the Act. (a) Upon request, bargain collectively with Sales Drivers, Sales and Service Local 176, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America as the exclusive representative of all employees in the unit described above and, if an understanding is reached, embody such understanding in a signed agreement. (b) Upon request, furnish the above-named labor organization all records necessary and relevant to decide' whether it desires restoration of the working conditions in effect prior to July 9. (c) Revoke the unilateral changes instituted on July 9, 1971, in the wages and other terms and conditions of employment of employees in the appropriate unit and restore those wages and other terms and conditions of provided in Sec 102 48 of the Rules and Regulations , be adopted by the Board and become its findings, conclusions, and Order, and all objections thereto shall be deemed waived for all purposes. JOHNSON'S INDUSTRIAL CATERERS, INC. employment in effect prior thereto and make employees whole for any losses they may have suffered by reason of the unlawful changes, if Sales Drivers, Sales and Service Local 176, affiliated with International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, the exclusive representative of these employees, so desires. (d) Preserve and upon request, make available to the Board and its agents for examination and copying all records relevant and necessary to a determination of the amounts due employees under the terms of this recom- mended Order. (e) Post at its Dayton, Ohio, facility, copies of the attached notice marked "Appendix." io Copies of said notice, on forms provided by the Regional Director for 10 In the event that the Board's Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted pursuant to a Judgment of the United States Court of Appeals enforcing an Order of the National Labor Relations Board " 359 Region 9, after being duly signed by Respondent's authorized representative, shall be posted by it immediate- ly upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, includ- ing all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. (f) Notify the Regional Director for Region 9, in writing, within 20 days from the receipt of this Decision, what steps it has taken to comply herewith.ii It is further recommended that the allegation of paragraphs found not to have been sustained by a preponderance of the evidence be dismissed. 11 In the event that this Recommended Order is adopted by the Board after exceptions have been filed, this provision shall be modified to read "Notify the Regional Director for Region 9, in writing, within 20 days from the date of this Order, what steps the Respondent has taken to comply herewith "